Growing your accessories business does not necessarily require a big investment. In fact, experts say that taking small steps is often the best way to grow this department. Here are several suggestions that can help a dealership’s accessories business.
The first step a dealer should take to move toward a profitable accessories department is to gather their staff together and ask them what customers ask for most that the company doesn’t have. Then, find out what in the dealership’s current accessories inventory is and is not selling. That information should provide a clearer picture of what inventory to keep on hand, what to acquire and what can be discontinued. Many dealers can buy the inventory they need to create a viable accessories department for the cost of one boat, according to Andy Larson of Midwest MasterCraft.
Developing the right process
The process a dealership uses to sell accessories can also play an important role in this department’s success. Many dealers ask the person who is selling the boat to attempt to sell accessories as well. The problem with this approach is that those products can become an afterthought once the big prize — the boat sale — has been won. In fact, accessories are sometimes thrown in to a boat sale just to sweeten a deal.
To combat this, David Parker of Parker Business Planning suggests carving the accessories portion out of the boat sale when the deal is booked. The total boat sale is reduced by the amount of the accessories sold so that the dealership has a true dollar value for the boat and a separate value for the accessories. Compensating the salesperson in conjunction with this — say three percent of the accessories sales, as long as they’re sold at the normal price — works well, he says.
Midwest MasterCraft favors another approach. At the dealership, once a boat is sold, the customer is turned over to a new salesperson who specializes in accessories — in much the same way a customer would be turned over to an F&I specialist.
“Your salesperson has done their job to get the boat sold and they’re invested, but also they’ve given up, if you know what I mean, and they don’t go get the accessory business,” Larson says. “If you put a fresh accessories person in front of the customer and they’re saying, ‘Oh, you need this and you need that,’ then there’s a whole new energy put into the thing. It works so much better.” If you don’t have the staff for a separate accessories department, the person making the boat sale can turn the customer over to another boat salesperson to handle the accessories sales.
Separating parts and accessories
Putting the proper people in place to sell accessories is another key to doing well. John Spader of Spader Business Management says that too often dealers aren’t selling an accessory as much as they’re taking an order for one. It’s a common mistake he sees where parts and accessories are treated the same when, in fact, parts are something a boater needs and accessories are wants.
“Accessories you’ve got to sell, just like units,” he says. “If you’re managing inventory, our belief is accessories should turn an absolute minimum of 3 to 5 times per year. The trendier the item, the higher the inventory turns should be. Customers will hunt you down and find you for a part. On an accessory, you’ve got to sell and market that. You’ve got to be convenient, easy, on the website, in the showroom. You’ve got to be creating a fun, exciting atmosphere and selling the emotion of it.”
To do well with accessories, the dealer should have a passion for it or hire somebody to run that department who does. People who have a strong desire to please, mixed with a strong desire to close do best in accessories, according to Parker, who says the accessories/pro shop segment of the business can often be a proving ground for the dealer’s next generation of salespeople.
Larson believes staffing is often a dealership’s biggest challenge with accessories and that a lot of dealers don’t have a strong “Type A” salesperson in the department but instead use somebody who didn’t work out somewhere else in the business. He advises dealers to ask themselves if their best customer was coming in to buy accessories, is the person you have selling them now the person you would want talking to that buyer?
“You need that sales personality, and then you need a little bit of the business side, either that person needs it or there’s a manager that’s overseeing opens to buy and turns and inventory aging and that kind of stuff,” Larson says. “Some sales guys aren’t always the people to manage that, so someone needs to take accountability.”
Midwest MasterCraft tracks margin and has sales goals and bonuses based on volume for its accessories personnel, making them accountable for how the department does, and Larson says that has helped margins.
M for Merchandising
Making sure products are visible in stores and presented in an appealing, sellable way is a partial definition of merchandising, and the experts say most dealers don’t do a very good job of it when it comes to accessories.
“Where accessories are emotional items, you have to merchandise them right,” Spader says. “Most dealers are terrible at merchandising.”
Product placement, packaging and promotions all play a part with merchandising. It’s important that dealerships view their stores like they would any retail establishment. Is the inventory fresh, priced and displayed with proper signage, or are there dusty boxes sitting on the shelves that have been there for years?
“It’s sort of sad how poorly things are merchandised in a lot of the accessory departments at boat dealers,” Larson says. “A lot of us get used to walking past it every day but all of a sudden whatever it was has got three years worth of shelf life sitting there. Jump back in and clean up the old skeletons and get the right inventory in, get some staffing and get some clinics from the manufacturers to make sure your staff is up to speed.”
Larson says it doesn’t take much to find second-hand store fixtures and the proper signage necessary to display things properly.
Pick your battles
Properly pricing the inventory is another important consideration. A dealership shouldn’t feel as though it needs to compete with big box stores on price. Don’t sell the same life jackets customers can find at Wal-Mart. That’s a battle the dealer doesn’t want to fight.
“You’re better off putting something that’s double the price point but that’s a higher quality vest, and then putting together a sales presentation on why somebody should spend that money,” says Larson.
Midwest MasterCraft sells a lot of life jackets, but doesn’t stock one that retails for less than $60. While Larson admits that part of that is his customer base, the dealership sells plenty of accessories to customers who bought their boats elsewhere. He advises dealerships to avoid targeting the price-point buyer.
Discounting accessories too heavily is a mistake Parker often sees dealerships make. Boat buyers may get a one-time 15- or 20-percent discount on everything in the store in return for the purchase, which Parker believes isn’t really necessary.
“I’ve seen some dealers take it beyond that and they give a 15- or 20-percent discount for as long as the customer wants,” he says, “and the dealership is really giving away a lot of money that they don’t have to.”